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Ksh at its weakest since it floated in 1994
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Scubidu
#661 Posted : Thursday, February 16, 2012 8:53:30 PM
Rank: Veteran

Joined: 9/4/2009
Posts: 700
Location: Nairobi
hisah wrote:
@kizee - shorting KES with CBR at double digits will be tough biz. But the moment CBK is pressed to lower it (they have to print money esp political influence) with inflation still at double digits, shorting KES resumes pronto due to the rates mismatch... For now it is still murky trying to figure out which way to play. I'm waiting for the so called $600M loan boost to see the market effect. Internationally, the global oil price spike and a likely Greece default are creating a lot of fog to forecast a medium term outlook - this two events happening together will just crash the markets.


@hisah. CBR will come down next month, inflation marginally, but most importantly the $600m is being used on infrastructure-which means it's not being used for further intervention. Thus the shilling should floor with Kizee scenarios becoz... I seem to remember the CB beefing up reserve the other day, USD 150 m to be exact, was this not printed?
“We are the middle children of history man, no purpose or place. We have no great war, no great depression. Our great war is a spiritual war, our great depression is our lives!" – Tyler Durden
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hisah
#662 Posted : Thursday, February 16, 2012 10:08:59 PM
Rank: Chief

Joined: 8/4/2010
Posts: 8,977
Scubidu wrote:
hisah wrote:
@kizee - shorting KES with CBR at double digits will be tough biz. But the moment CBK is pressed to lower it (they have to print money esp political influence) with inflation still at double digits, shorting KES resumes pronto due to the rates mismatch... For now it is still murky trying to figure out which way to play. I'm waiting for the so called $600M loan boost to see the market effect. Internationally, the global oil price spike and a likely Greece default are creating a lot of fog to forecast a medium term outlook - this two events happening together will just crash the markets.


@hisah. CBR will come down next month, inflation marginally, but most importantly the $600m is being used on infrastructure-which means it's not being used for further intervention. Thus the shilling should floor with Kizee scenarios becoz... I seem to remember the CB beefing up reserve the other day, USD 150 m to be exact, was this not printed?

Great, just great... So time comes again to start placing USDKES bull targets...

Just seen this NTV video titled IMF's role in the depreciation of the shilling.

Quote:
A sequence of seemingly unrelated events to the outside world starting back in 2009 may have led to the drastic depreciation of the shillings value against foreign currencies late last year. But could the seed of this crisis have been planted unwittingly by the International Monetary Fund?


https://www.youtube.com/...feature=player_embedded

BD article - http://www.businessdaily.../-/9gxeegz/-/index.html
$15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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  | | Edit by user: Thursday, February 16, 2012 10:11 PM | Reason: Not specified
hisah
#663 Posted : Friday, February 17, 2012 12:07:42 AM
Rank: Chief

Joined: 8/4/2010
Posts: 8,977
Kenyans on dollar salaries take pay cut as shilling gains.

http://www.businessdaily.../-/158u0k1/-/index.html

Now the grand question is, if those earning in dollars have taken a pay cut, are those earning in KES on a pay hike? At some point last year KQ wanted to start charging local air tickets in USD. One of the two currencies is about to get exposed soon...
$15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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hisah
#664 Posted : Monday, February 27, 2012 11:33:23 PM
Rank: Chief

Joined: 8/4/2010
Posts: 8,977
Finally the 50Billion ($600M) loan is here as per treasury. But someone is having a nagging feeling about high tbill rates and inflation may refuse to collapse from the current lofty levels because of...

Quote:
Surging costs of oil and predicted food shortages, however, remain a major risk to stability of the shilling and inflation rate, Prof Ndung’u said.

The cost of crude oil has shot to above $120 a barrel in the international markets due to rising tensions between the West and oil-rich Iran due to its nuclear energy ambitions.


At least the reality has not escaped the policy makers - that's an encouraging sign. But calling for single digit inflation by end of 2012 like earlier before is not very smart perception management and just an outright lie.

http://www.businessdaily...6/-/1193lkv/-/index.html
$15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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Cde Monomotapa
#665 Posted : Tuesday, February 28, 2012 12:34:32 AM
Rank: Chief

Joined: 1/13/2011
Posts: 5,964
And many still bury their heads in the sand to the fact that an avalanche of Debt & Equity capital into SSA is increasingly gathering momentum. I wonder what to them builds up main-street/the Real economy. Anyway, the world will always have its fair split of Observers & Participants-Victims & Victors.
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  | | Edit by user: Tuesday, February 28, 2012 12:35 AM | Reason: Not specified
Cde Monomotapa
#666 Posted : Tuesday, February 28, 2012 12:46:31 AM
Rank: Chief

Joined: 1/13/2011
Posts: 5,964
In addition, why isn't the writer of that BD article smart enough to analyse the potential impact on FX rates when KE recieves that USD600M? That it could see USD/KES break the 80 handle into the upper 70s or higher? Wouldn't that mitigate and even lower Import Inflation?
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  | | Edit by user: Tuesday, February 28, 2012 12:49 AM | Reason: Not specified
Cde Monomotapa
#667 Posted : Tuesday, February 28, 2012 12:53:55 AM
Rank: Chief

Joined: 1/13/2011
Posts: 5,964
And when all this is said & done please find T-Bill & Bond rates in the single digits ASAP and the NSE @ 5,000pts. Laughing out loudly Laughing out loudly Laughing out loudly
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Cde Monomotapa
#668 Posted : Tuesday, February 28, 2012 1:09:34 AM
Rank: Chief

Joined: 1/13/2011
Posts: 5,964
And yes indeed the Met Dept.is right to forecast a dry spell because surely it is public knowledge that Q1 is seasonally a dry period followed by the long-rains in Q2 in Kenya. So what is this storm in a tea cup that BD is trying to play up unless making a buck off perpertuating ignorance.
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  | | Edit by user: Tuesday, February 28, 2012 1:31 AM | Reason: Not specified
FUNKY
#669 Posted : Tuesday, February 28, 2012 8:41:43 AM
Rank: Veteran

Joined: 4/30/2010
Posts: 1,635
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hisah
#670 Posted : Tuesday, February 28, 2012 11:46:06 PM
Rank: Chief

Joined: 8/4/2010
Posts: 8,977
As usual IMF recommending the 'best pills' after taking over... They want high lending rates to stay so that lending shrinks below 30%. So let's see this script, high lending rates, high oil prices, high inflation rates, more IMF austerity conditions will lead to further slowdown of the econ. As long as lending rates remain sky high, tbill rates will equal stay high. In an election period with no money printing, politicos will fight back. That tug of war will lead to parliament showdowns like the current finance bill... Quite interesting days ahead.

http://www.businessdaily...6/-/iyxc95z/-/index.html
$15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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